Amendments to planning bill could allow 'alternative providers' to process planning applications

Changes to the Bill put forward by the UK government would also give the communities secretary powers to direct local authorities to dispose of surplus land and to prevent planning obligations relating to affordable housing from being enforced and would pave the way for the introduction of a dispute resolution process for section 106 agreements.

Addressing the House of Commons last week, housing and planning minister Brandon Lewis said that new clauses introduced to the Bill would "test the benefits of introducing competition in the processing of planning applications".

The clauses would enable the communities secretary to carry out pilot schemes allowing applicants to choose whether to submit a planning application to the relevant planning authority or to an alternative provider for processing. Lewis said the determination of any application would remain the responsibility of the planning authority and that the initial pilot schemes would run for a limited period of time.

Labour MP Helen Hayes raised concerns that the proposals would "weaken the accountability of local planning services" and would threaten the ability of planning departments to fund themselves by charging planning fees. Clive Betts MP described the proposals as "extremely worrying". Betts queried whether alternative providers would be as familiar with local needs as council officers and suggested applicants might "shop around for whichever alternative provider they think can give them the best chance of getting a planning application accepted".

Labour MP Dr Roberta Blackman-Woods said the proposed introduction of alternative providers had "the potential ... to generate a degree of corruption and totally inappropriate conflicts of interest".

Blackman-Woods also said proposals to "force a range of public bodies to give up land for development" were "draconian" and that the introduction of clauses that would result in "huge changes to the planning system" after the Bill had received its second reading in the House of Commons was "quite frankly disgraceful". 

Several amendments proposed by opposition MPs were rejected by the House of Commons. These included attempts to reduce the emphasis in the Bill on the provision of starter homes to the exclusion of other tenures, to ensure that the 20% discount on starter homes remain in perpetuity rather than lasting only five years and to limit permission in principle to housing on brownfield land in England.

However, an amendment from Conservative MP Zac Goldsmith, requiring the replacement of every high value council home sold in London with two new affordable homes, received approval from the House.

Planning expert Helen Stewart of Pinsent Masons, the law firm behind Out-Law.com, said: "Developers will welcome the proposed dispute resolution mechanism as an alternative to appeal against non-determination. This, and the government’s proposals for the disposal of surplus public sector land, has led to this being seen as a developer’s bill."

"Much of the industry reaction has, unsurprisingly, focused on the proposed introduction of 'alternative providers' into the planning process, widely denounced as the 'privatisation of planning'," said Stewart. "Viewed as fundamentally undemocratic by many, critics are calling instead for increased funds to enable local planning authorities to meet capacity requirements themselves rather than outsourcing to the private sector.  Whether these concerns are justified remains to be seen as the Bill sets out an indicative framework with much of the crucial detail to be determined. "

"We are assured that only the processing of planning applications is to be outsourced, with the actual determination of the application itself remaining solely with the local planning authority. But what precisely is envisaged by 'processing'?  Any scope for erosion of accountability surely hinges on this question," said Stewart. "However, we must remember that local planning authorities have for years outsourced elements of work to the private sector to ease capacity and have successfully navigated issues of conflict of interest. Historically, privatisation has taught us that competition leads to innovation and it is possible that this will lead to new products and solutions which will ultimately benefit local planning authorities."

The Bill received its third reading in the House of Commons this week and will now proceed to the House of Lords.